Telecom Italia underwent a great transformation during 2010
In 2010 Telecom Italia increased its presence in Latin America – thus rebalancing the Group’s activities compared to domestic operations -, considerably improving its capital structure and completing a significant recovery in competitiveness.
TI Group FY10 Key Financial Achievements
- In 2010, Telecom Italia improved its cash flow generation, reaching 6.6 billion euro, + 300 million euro YoY (6.2 billion aside from the extra 400 million euro paid
- The organic Ebitda at Group level was stable, in line with the guidance for the Domestic market, yet over-delivering in Brazil
- Net income at Group level grew by 18.4% YoY on a normalized basis
- TI achieved, at the end of 2010 a Net Financial Position of 31.5 billion euro, well below the target of approximately 32 billion euro. That figure does not include the cash-in for the sale of Etecsa (400 million euro), completed at the beginning of 2011
- Average cost of debt declined to 5.2%.
Domestic Market
Strong Cash Cost Control Invested to Regain Competitiveness
- 2010 full-year figures show that the strong cash cost control allowed Telecom Italia to reach the profitability target in the domestic market: EBITDA equal to 9,774 milion euro (EBITDA margin equal to 48.7%, +2.3 p.p. YoY)
- In terms of top line, 2010 has been a tough year; despite that, TI made some very important steps towards a recovery, such as improvements in the fixed retail revenues and a positive cash flow generation through capex discipline (Ebitda - Capex +1.8% YoY).
Domestic Fixed: TI Access Performance
- In the fixed business, 2010 performance in terms of number of accesses was satisfactory, with just 746k line losses, half a million less than in 2009; that permitted us to reach the updated target of “below 800k”
- Enhanced Quality of Service was the key factor to defend our position and sustain premium price.
TIM Brasil
Turnaround accomplished
- TIM Brasil started two years ago a turnaround phase, focused on two very important pillars: strengthening foundations and balancing growth with profitability
- Over 51 million of clients and revenues equal to 6,2 bln reais confirm TIM Brasil as one of the TOP 10 largest Brazilian companies
- In 2010, TIM Brasil has been the operator with the highest customer base growth (incremental market share equal to 34%). This growth in in customer base has been followed by consistent improvements in profitability
- TIM is the second player in value in the fourth largest mobile markets in the world in terms of revenues
- Economics: it has doubled EBIT and operating cash flow in 2010 and net income is 3 times more than in 2009. Net debt has been reduced to 0,4 bln.